Just as diesel prices seemed to ease, the sudden upturn in recent weeks proves that the wild ride of diesel isn’t a slide, but a rollercoaster.
Diesel is back on the rise, with the last two consecutive weeks bringing increases exceeding a nickel. For carriers trying to budget for a decent holiday, it’s imperative to ask, is the upturn a blip, or a pattern that will define 2027?
Here’s the current state of diesel.
Where Diesel Stands
As of 10/26, the EIA reports national diesel prices at $6.32 per gallon. In the last two weeks, prices have risen by 17.3 cents, a ~3% increase.
$6.32 represents a national average. Actual prices vary widely by region:
- West Coast $7.33
- California $8.16
- Rocky Mountain $6.52
- Midwest $6.48, up 12.8¢, the biggest weekly jump of any region
- East Coast $6.08
- Gulf Coast $5.95
Will Diesel Keep Climbing?
Unfortunately, several factors point to diesel climbing in the coming weeks:
- As winter looms, the demand for heating will compete for the same barrels of diesel, likely squeezing supply further.
- Inventories are thin. East Coast distillate stocks are down 32% from the five-year average, leaving the industry with little insulation should an outage occur.
- Middle East oil flows remain restrained. Strikes at Russian refineries have exacerbated the supply constraint.
With such a brutal trifecta of adverse industry conditions, you may be thinking that $7 diesel may ground Santa this year.
But there is hope.
Will Diesel Hit $7 Before the Holidays?
Despite overwhelming geopolitical headwinds, $7 diesel is unlikely.
The EIA estimates that costs may hover around the $6 gallon mark through 2026, but once conditions normalize, they will likely return to a national average of $4.50 in 2027. Macroeconomic forecasts aside, there are several cost-relief initiatives underway that may present faster relief:
- The G7 has agreed to release 100 million barrels of oil and diesel, providing some relief to the supply squeeze.
- The U.S. has also announced 40 million barrels of SPR crude exchanges.
- A Russian deal has been proposed to free up 8 million tonnes of diesel, but the actual amounts remain uncertain.
These initiatives provide hope that rising costs may not reach bargain levels, but will, at the very least, slow their increase.
Dollars Off Every Gallon of Fuel with the ECS Fuel Card
The very best stocking stuffer is a fuel card that will save you up to dollars per gallon.
With the England Carrier Services fuel card, you can deter difficult diesel conditions with these benefits:
- Discounted fuel at Love’s, TA, and Petro, at 900+ locations.
- Free setup and low transaction fees. Load your card free, 24/7.
- Set your own limits on driver cards. Get free online reports showing where, how much, and at what price every gallon was bought.
- Qualifying carriers can get a line of credit, which helps when the pump moves faster than your surcharge.
Click here to get started with the England Carrier Services fuel card.
Diesel prices are back on the rise, but the climb isn’t vertical. Despite several difficult supply constraints, cost-saving initiatives, and the regular rightsizing of economic conditions, there is light at the end of the tunnel.
Carriers can only hope they have enough fuel in their tanks to make it through the tunnel to see the light.
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